Multiple states – including Alaska, Wisconsin and New Jersey – have been busy finalizing legislation and rulemaking to adopt interstate compacts and amend and clarify telehealth-related standards of care.
What else have these states been up to over the last month?
Under the SECURE Act and the SECURE 2.0 Act, employers must provide long-term, part-time employees the opportunity to make elective deferrals under their 401(k) plans and, beginning in 2025, their 403(b) plans. This new rule is fraught with complexity and has generated numerous questions about how the requirements apply. But in talking about the new rule, we often do so in simpler terms by focusing on the anticipated impact on employees working more than 500 hours (often thought of as the new eligibility threshold) but less than 1,000 hours (often thought of as the old eligibility threshold).
For the most part, that’s fine. In fact, doing so provides a helpful and, in some cases, necessary shorthand for discussing the primary differences between the long-understood old eligibility rule and the more complicated new one. However, because certain special rules apply to employees who enter an employer’s plan as long-term, part-time employees, it is important for all employers to understand when an employee is a long-term, part-time employee.
On January 2, 2024, McDermott filed an amicus curiae brief on behalf of the ERISA Industry Committee (ERIC) and the United States Chamber of Commerce (Chamber) in United Behavioral Health v. David K., No. 23-586, in the US Supreme Court. The case presents two questions of broad public importance concerning the requirements under the Employee Retirement Income Security Act (ERISA) for denials of health benefits. But underlying the two questions is an even more fundamental Administrative Procedure Act (APA) issue: May a court, at the invitation of an agency in an amicus brief, effectively amend regulations by judicial fiat, providing the agency with an end run around the APA’s notice-and-comment rulemaking procedures?
The answer to that question should be an obvious no. But that is precisely what happened in the court of appeals in this case. After the plaintiffs filed their response brief, the US Department of Labor (DOL) filed an amicus brief urging a radically new interpretation of regulations the agency had promulgated to implement ERISA’s procedural protections. In essence, the DOL argued that its disability- and health-benefit regulations should be read to contain the same procedural requirements, despite clear regulatory language specifying that some requirements only apply in one context and not the other. The US Court of Appeals for the Tenth Circuit adopted the DOL’s position, decreeing a new regulatory requirement for health-benefit denials that the DOL, in dual 2015 and 2016 rulemakings, expressly considered and chose to adopt only for disability-benefit denials and not for health-benefit denials.
If not corrected by the Supreme Court, the decision will stand as an invitation to agencies to file amicus briefs in the courts of appeals, advocating for substantial changes to their regulations without the bother (or transparency) of APA rulemaking. When so much lawmaking today is undertaken by unaccountable federal bureaucrats, that is a deeply troubling prospect. ERIC and the Chamber supported the petition, explaining the legal and practical issues with the approach the DOL and Tenth Circuit mutually took. Agency interpretations that defy clear regulatory text are entitled to no deference because they are invalid (especially after the Court’s decision in Kisor v. Wilkie). Ignoring this basic proposition of administrative law undercuts the core values served by the APA, including transparency and accountability. Most directly, however, an agency’s decision to seek backdoor revisions to its rules through interpretations announced in litigation deprive the agency of the benefit of public comment that can provide critical data and analysis to inform the agency’s policymaking. Had the DOL engaged in notice and comment, as it should have done, commenters would have presented key distinctions between the disability- and health-benefit contexts; without that information, the DOL’s decision was not fully informed.
ERIC and the Chamber are frequent amici in cases concerning ERISA and the APA’s interpretation and requirements. While the Supreme Court grants only a tiny fraction of the petitions it receives each term, the amici are hopeful that this brief will help focus the Court’s attention on this [...]
Continue Reading
While former President Donald Trump has threatened to repeal the Affordable Care Act (ACA) if he wins reelection, the landmark healthcare law would be increasingly difficult to dismantle. In this CNN article, McDermott+Consulting’s Rodney Whitlock says the country is “as close as we’ve been to meeting the aspirational goals of 2010 for the ACA.”
Following a dynamic 2023 coupled with a continually evolving legal landscape, employers may feel that they are left with more questions than answers. During a recent webinar, McDermott’s employment team took a dive into the most pertinent legal updates of 2023 and shed light on uncertainties to prepare employers for the year ahead. The discussion covered new laws taking effect in 2024, explored key developments impacting the workforce and advised on what employers can expect heading into the new year.
The Biden administration recently announced that 28 healthcare payors and providers intend to implement and adhere to voluntary commitments for the safe, secure and trustworthy development and deployment of artificial intelligence (AI) in healthcare. The signatory companies aligned around the FAVES principle—namely, that AI should lead to healthcare outcomes that are fair, appropriate, valid, effective and safe.
On November 6, 2023, the Centers for Medicare & Medicaid Services (CMS) issued a proposed rule for the Medicare Advantage and Part D programs. Among other proposals, CMS proposed significant changes to longstanding rules on permissible payment structures for agents and brokers. Specifically, CMS proposes to prohibit “overrides” or administrative fees paid to agents and brokers outside of the fair market value enrollment compensation limits established by CMS. This could have a significant impact on MA and Part D plan arrangements with agents and brokers.
How can the independent sector and choice make a dent in reversing the increasingly high number of United Kingdom healthcare patients waiting for treatment? In this LaingBuisson News article, Sharon Lamb examines the latest waiting time data and offers perspective on potential solutions.
How can HR professionals elevate their game to attract talent and spearhead innovative strategies?
In this ManageHR article, Elizabeth Vassolo, McDermott’s Global Head of Employment Brand, shares her perspective on emerging HR trends, highlights a game-changing project and offers actionable advice.
The Protect Illinoisans from Unfair Medical Debt bill will require Illinois hospitals to take a much more active role in limiting consumers’ medical debt. The bill puts into place four primary requirements designed to reduce the medical debt burden of individuals receiving care. These requirements will apply to services provided on or after June 29, 2024.
Subscribe
